By Dimitra DeFotis

Analysts at Dahlman Rose and Sterne Agee renewed their bullish stance on Schlumberger and its deepwater prospects Tuesday following last week’s earnings report.

Dahlman Rose Analysts James Crandell, Doug Garber and J.B. Lowe trimmed their 2013 earnings estimate for oilfield services giant, but reiterated their buy rating and $92 price target. Sterne Agee analysts Stephen D. Gengaro and Grant Fox also reiterated a Buy and raised their price target from $89 to $93, saying Schlumberger is “well positioned to generate strong earnings growth and robust free cash over the next several years.” They also cheered Schlumberger’s dividend increase.

Traders aren’t as bullish. Michael Purves, Chief Global Strategist and head of equity derivatives research at Weeden & Co., advised investors to cash out of Schlumberger Friday “and wait for re-entry points” as we noted here.

Shares of Schlumberger (SLB) were up $1.32, or 1,7%, to $77.82 in the last hour of trading. Rising oil prices, in light of increased security risk getting buzz, should give oilfield services stocks a boost.

On Friday, Schlumberger reported fourth-quarter earnings of $1.08 per share. A 24% increase in Gulf of Mexico revenue, due to improved deepwater rig activity, offset weak pricing for land drilling. Gengaro and Fox say in the Eastern Hemisphere, rising profitability will come in 2013-14, though they remain “worried about the magnitude of margin growth near term as geopolitical noise and limited pricing gains slow the progress.”

Crandell et al at Dahlman think the stock deserves a multiple of 19 times, representing a roughly 50% premium to the Standard & Poor’s 500 multiple, which is “justified, in our view, due to SLB’s exposure to the multiyear growth anticipated in international E&P spending.” They add:

“While the international business had a weaker-than-expected quarter due largely to seasonal slowdowns in the North Sea, Russia, and China and contract delays in North Africa, we expect it to be the main source of growth in 2013. The Middle East/Asia and Europe/CIS/Africa regions should be particularly strong in 2013 while Latin American growth may be slightly hindered by flattish Brazil activity. We expect the international top line to rise 12.4% in 2013 with 22% margins.”

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